Wall Street’s biggest banks are taking a victory lap this week after a global AI boom fueled one of their strongest quarters in recent years. <\/p>\n
JPMorgan Chase (JPM<\/a>), Bank of America<\/a> (BAC<\/a>), Citigroup (C<\/a>), Wells Fargo (WFC<\/a>), and Goldman Sachs<\/a> (GS<\/a>) reported collective profits of $49 billion in the second quarter, up 39% year over year. <\/p>\n Executives for these giants said Tuesday that the AI boom is turbocharging a cycle of Wall Street activities. More trading activity is generating record quarters for their equity trading groups. AI-related IPOs, debt raising, and other deals are throwing off hefty underwriting and advising fees. <\/p>\n Furthermore, the recent successes are enticing more companies to join the action, while newly rich tech workers and investors become wealth management clients. <\/p>\n “The build-out of AI infrastructure remains in its early stages, and we believe in this multiyear investment cycle,” Goldman Sachs CEO David Solomon said in a call with analysts. <\/p>\n “Given our progress and what we see in our pipeline, we expect this flywheel of activity to continue,” Solomon added. <\/p>\n Much of Wall Street’s attention in the second quarter was glued to blockbuster AI-driven capital raises, most notably SpaceX’s record IPO and Alphabet’s massive follow-on stock offering. But executives said those major deals are just part of a broader resurgence that has more room to run.\u00a0\u00a0 <\/p>\n Revenue from Goldman’s equities trading division rose 72% year over year to $7.4 billion in the second quarter, setting an all-time record haul by any bank in stock trading. Its investment bank reported $3.4 billion in revenue, its highest quarterly figure since 2021. <\/p>\n JPMorgan also logged a massive quarter in stock trading, with revenue from that group soaring 86% to $6 billion. “In some respects, a lot of it is just downstream of the AI theme writ large on a global basis, and it’s just a very, very, very active environment,” JPMorgan Chase CFO Jeremy Barnum told reporters Tuesday. <\/p>\n Bank of America’s stock traders also scored a record quarter, with fees climbing 70% to $3.6 billion. <\/p>\n “The financing \u200bopportunities lead to hedging opportunities, and we don’t see that cycle of investment slowing,” Denis Manelski, Bank of America’s co-head of global markets, said in an interview.\u00a0 <\/p>\n Successful raises are spurring other companies to follow suit. Leading Chinese AI startup DeepSeek is preparing for an IPO, according to a Tuesday Bloomberg report. Anthropic (ANTH.PVT<\/a>) is expected to list later this year, while OpenAI (OPAI.PVT<\/a>) also has plans to go public. <\/p>\n Looking out into next year, the dealmaking “pipeline is very healthy,” Citigroup CEO Jane Fraser said. Her bank reported a 44% rise in investment banking revenue, driven by a surge in fees from equity and bond underwriting.\u00a0 <\/p>\n In M&A, “AI is dominating a lot of the conversations,” Fraser added. <\/p>\n “It’s getting close to as good as it gets,” JPMorgan CEO Jamie Dimon said when asked about the current banking environment. <\/p>\n “We’re in a very healthy, active, exuberant market with very high prices and very high volumes. We benefit from that. We just don’t know how long it will continue,” he added. <\/p>\n David Hollerith covers a range of developments throughout the financial sector, from Wall Street to banking and asset management to crypto and fintech. Email him at david.hollerith@yahoofinance.com. Follow him on X at @DsHollers. <\/p>\n